SM Commodities Index - May 2021

15 June 2021

The latest prices and key trends from the SM Commodities Index.

Iron ore

Iron ore prices have been pushed to new record highs of $235/t CFR China in mid-May 2021. Volatility picked up in steel market pricing following the confirmation of the removal of steel export tax rebates in China. HRC steel FOB China prices rallied 30% through April, peaking at $1,030/t, which carried iron ore to all-time highs.

Prices have since consolidated back to $180 before rallying again to $211 in mid-June. Iron ore prices are able to sit at such lofty levels due to the massive margins still being enjoyed by steelmakers in China as a result of all-time-high steel prices.


Brazilian sugar prices have been on the rise since the beginning of the crush season, which started in April. The first two months have seen a delay in crushing and the decrease in the productivity of sugarcane because of dry conditions.

On top of that some mills have made the switch from crushing for sugar to crushing for ethanol. Overall early season estimates have the indicated a decline of 4-10% for sugarcane production, and with more headed to ethanol, sugar production will fall further.

Finally Brazil’s exchange rate has been rising over the past few months and sugar prices domestically increased 6.2% while increasing 11.6% in USD. The strengthening Brazilian real decreases sugar export sales, with lower returns in local currency providing more incentive for ethanol versus sugar.

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